Last week, Harley-Davidson stock (HOG) traded on a positive note and ended the week at $48.01, rising ~1.3% during the week. The company’s stock has lost ~11.1% quarter-to-date and has seen a value erosion of 17.7% in 2017 so far. Let’s look at its key technical levels for the week ahead.
Key support and resistance
In August, Harley-Davidson stock tested a support near $46.20, which should continue to act as an immediate support in the third week of September. In August, the stock’s performance was largely mixed, and it ended the month with a minor rise of 0.8%. Its immediate resistance lies near $49, and its key resistance is near $51.90.
Its 14-days RSI (relative strength index) score is hovering near the equilibrium of 51.7, indicating a mixed bias in its underlying momentum. On the weekly price chart, its price action is still limited to a narrow range of $48.10 to $46.60. Only a breach of this narrow range could confirm any upcoming short-term trends for the stock.
Mixed bias fundamentals
In 2Q17, Harley’s adjusted EPS (earnings per share) were $1.48, about 4.5% lower than its EPS in the same quarter of the previous year.
Harley’s profit margins have not seen any notable growth in the last few quarters, due to an unfavorable product mix. For Harley, lightweight motorcycles tend to yield weaker profit margins than heavyweight motorcycles. Similarly, legacy automakers (FXD) Ford Motor (F), General Motors (GM), and Honda (HMC) see higher profits from heavyweight vehicles than small cars.
Going forward, the company’s management doesn’t expect any improvement in its fiscal 2017 profit margins, which could continue to keep investors’ sentiments mixed. Visit our page for the latest news and updates on the sector.